{"id":322547,"date":"2023-04-05T01:15:51","date_gmt":"2023-04-04T17:15:51","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=322547"},"modified":"2023-04-05T01:17:13","modified_gmt":"2023-04-04T17:17:13","slug":"stock-in-focus-bdo-unibank-inc-bdo-5-apr-2023-by-regina-capital-development-corp","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-bdo-unibank-inc-bdo-5-apr-2023-by-regina-capital-development-corp\/","title":{"rendered":"Stock in Focus: BDO Unibank, Inc. (BDO) – 5 Apr 2023 by Regina Capital Development Corp."},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>BDO<\/td><\/tr>
Company Name<\/strong><\/td>BDO Unibank Inc.<\/td><\/tr>
Broker<\/strong><\/td>Regina Capital Development Corp.<\/td><\/tr>
Opinion Issued on<\/strong><\/td>5 Apr 2023<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 154.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Overall, we are still BUY on BDO with a higher Target Price of P154.00\/share.<\/p>\n\n\n\n

<\/div>\n\n\n\n

Analysis and Opinion<\/h2>\n\n\n\n

BDO Unibank, Inc. (BDO) surprised yet again with its better-than-expected 4Q 2022 Net Income of P17.08 billion, up 64.66% year-on-year (y\/y). It came on the back of a double-digit expansion in its core business (+22% y\/y) and fee income (+16% y\/y), coupled better asset quality which prompted the bank to slash its loan loss provisions. Overall, this pushed its full-year bottomline print up by +34% y\/y to P57.23 billion \u2014 ahead of our 2022 projections (105%).<\/p>\n\n\n\n

However, it should be noted that BDO\u2019s loan growth came in slower than the
industry\u2019s average of +11% y\/y. With BDO\u2019s intention to push its quarterly cash
dividend payment to P0.75\/share (+150% y\/y), chances are, the bank\u2019s loan growth
might continue to see moderation moving forward. Furthermore, the
management\u2019s objective to keep its CET-1 ratio at around 13.4% echoes the aforementioned hypothesis. <\/p>\n\n\n\n

On the other hand, BDO\u2019s non-interest income went up by +17% y\/y to P71.5 billion, thanks to the sustained double-digit growth in fee income and +4% y\/y rise in its insurance premiums.<\/p>\n\n\n\n

Meanwhile, as the local economy further reopens, BDO\u2019s quarterly non-performing loans (NPL) ratio improved sequentially by 0.28bps to 1.95%, nudging the bank to book a lower loan loss provision of P4.2bn (-37% y\/y) in 4Q22, or P16.37bn (-4% y\/y) for the whole 2022. In this wise, it can be implied that the paying capacity of BDO\u2019s clients have started to be positioned better as the pandemic gradually takes the back seat. This brought BDO\u2019s NPL coverage ratio to 167%.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>